In the last decade, numerous wind energy generation projects spanning the state of Kansas have come online. While it is clear that the nineteen wind energy projects currently in operation and under construction in Kansas have significantly impacted the Kansas economy at the local, county and state levels, specific data about the actual economic impacts generated by these projects is not readily available. This report provides empirical, factual data based upon reports and actual experiences of Kansas citizens, utilities, and project developers. The report then seeks to compare that empirical data against non-partisan academic studies of the potential economic impacts of wind generation for state and local economies.

1. New Kansas wind generation is cost-effective when compared to other sources of new intermittent or peaking electricity generation.

Dockets filed for recently built utility energy projects indicate that wind projects are providing Kansas utilities with cheaper power per megawatt-hour (“MWh”) than other forms of intermittent or peaking electricity generation, including natural gas. As a result, the impact on electricity rates for retail customers for new wind generation is roughly equivalent to, or often less than, the rate impact that would be caused by other forms of new generation.

2. Wind generation is an important part of a well-designed electricity generation portfolio, and provides a hedge against future cost volatility of fossil fuels.

Wind generation is not intended to be a substitute for coal or natural gas generation, but instead plays an important role in balancing a utility’s load demands and offsetting volatile fuel costs. Because the bulk of wind generation costs are paid upfront (or set at a predetermined rate for the life of the project in the case of wind power purchased through a power purchase agreement), utilities use wind generation to introduce known costs into their long-term portfolios to hedge against the future cost volatility of fossil fuels.

3. Wind generation has created a substantial number of jobs for Kansas citizens.

Based upon empirical data from each of the Kansas wind farms and economic studies conducted by third-party sources, Kansas wind generation has created a significant number of jobs for Kansas citizens.

4. Wind generation has created significant positive impact for Kansas landowners and local economies.

Empirical data from each of the Kansas wind farms and economic studies conducted by nonpartisan sources indicate that Kansas wind generation has created the following additional economic impacts for the state:

5. The Kansas Renewable Portfolio Standard is an important economic development tool for attracting new businesses to the state.

Sustainability is an increasingly important factor to companies looking to locate new facilities and the RPS is the most visible symbol to companies evaluating a state’s commitment to sustainability. Should the RPS be eliminated, or reduced to a non-material level, a similarly clear negative message would be sent to those companies that include sustainability as a factor in site selection.

In May of 2009, Kansas Governor Mark Parkinson signed into law a piece of comprehensive energy legislation, Senate Bill 108, the Economic Revitalization and Reinvestment Act. One of the provisions in that legislation enacted a Renewable Portfolio Standard (“RPS”) for the state of Kansas, stating “the nation’s energy challenge provides the opportunities for a ‘made in America’ energy program, and Kansas is ready to be a leader in that effort. I look forward to the new jobs, more wind power, and the stronger economy that will be a result of this legislation.”

Now, three years into the RPS program, Kansas has capitalized on its access to one of the best energy resources in the country to develop an important wind industry in the state. The nineteen wind projects currently in operation or under construction and the direct and indirect manufacturing jobs that have come to Kansas have created thousands of jobs for Kansans, and encouraged investments of hundreds of millions of dollars in local economies.

Unfortunately, very few studies have been conducted that provide an accurate, empirical analysis of the true economic impacts of the wind industry on the Kansas local, county and state economies. This report endeavors to answer some of the fundamental questions that will be raised as Kansas maps out its future energy goals:

1.) What is the actual cost of new wind generation as compared to similar new generationfrom other resources?

2.) How many jobs does the Kansas wind industry create?

3.) What are the economic impacts for landowners that site wind projects on their property?

4.) What are the economic impacts for local and county governments that host wind projects?

5.) What is the value of the Renewable Portfolio Standard for Kansas beyond the power generated for Kansas utilities?

In order to help facilitate thoughtful policy discussions about these issues, this report analyzes the ample data that has been provided by the wind energy projects across the state, as well as various academic and economic analyses of the impacts that wind generation can provide for state and local economies, in order to determine the actual benefits that Kansas wind generation has brought to the Kansas economy…

In order to understand the current status of the wind industry in Kansas and its impact on the state economy, it is necessary to first understand why Kansas is uniquely positioned to reap its extraordinary wind resource.

Kansas enjoys one of the best wind resources in the world, ranking between first and third among the states in terms of total wind capacity.2 To quantify this resource, wind speed measurements are taken at several heights that reflect typical wind tower hub heights: 50 meters, 80 meters, and 100 meters. As Figure 1 below illustrates, at 50 meters most of western Kansas has access to “Class 4” winds, with wind speeds ranging from 7.5 to 8.1 meters per second, with a number of additional locations reaching “Class 5” status, with wind speeds ranging from 8.1 to 8.6 meters per second.

To understand how Kansas’ access to wind compares to other states across the country, it is necessary to consult Figure 2 below, which illustrates the wind speeds at a height of 50 meters for the entire United States.

…Kansas is well positioned in America’s “Wind Belt.” This geographic advantage means that Kansas has access to a robust renewable energy source that few other states share. Kansas and its neighboring Plains states have access to one of the best wind resources in the United States. As Figure 3 below shows, the electrical transmission grid in the U.S. is broken into three distinct electrical interconnections: ERCOT, which serves most of Texas, the Western Interconnect, which serves all states west of the Colorado-Kansas state-line, and the Eastern Interconnect. With new transmission projects in the works to alleviate bottlenecks in the grid (See Section C.1 below), Kansas is in a prime position to export power from its excellent wind resource.

Prior to 2012, Kansas ranked ninth among states in terms of operational wind energy. Building on this success, Kansas has led the nation in new wind energy construction in 2012, with an anticipated operational wind energy capacity of approximately 2,714 MW by the end of 2012…

Kansas is fortunate to be in a position to truly be a leader in an “all-the-above” energy strategy and, while there have been some attempts to guess at the impact of what wind energy development has done and will continue to do for the Kansas economy, there had not been a good study evaluating the data as to what has actually happened. Fortunately, because the Kansas utilities have embraced wind energy generation as a valuable component of their energy portfolios and made significant strides towards accomplishing the state’s RPS goal of twenty percent renewable energy by the year 2020, the data that is required to do this economic analysis is now publicly available.

Based upon empirical data from the wind energy projects currently operating and under construction in the state, we can make the following conclusions:

1.) New Kansas wind generation is cost-effective when compared to other sources of new electricity generation, as substantiated by the public reports filed by the utilities with the KCC.

2.) Wind generation is an important part of a well-designed electricity generation portfolio, and provides a hedge against future cost volatility of fossil fuels.

3.) Wind energy generation has provided a substantial number of jobs for Kansas citizens, and provides important economic benefits for landowners and local economies.

4.) The Kansas Renewable Portfolio Standard (RPS) is an important economic development tool for attracting new businesses to the state.

It is the authors’ objective to facilitate thoughtful policy discussions about these issues, as they will remain important to Kansas now and in the years to come.

Review of OIL IN THEIR BLOOD, The American Decades by Mark S. Friedman

OIL IN THEIR BLOOD, The American Decades, the second volume of Herman K. Trabish’s retelling of oil’s history in fiction, picks up where the first book in the series, OIL IN THEIR BLOOD, The Story of Our Addiction, left off. The new book is an engrossing, informative and entertaining tale of the Roaring 20s, World War II and the Cold War. You don’t have to know anything about the first historical fiction’s adventures set between the Civil War, when oil became a major commodity, and World War I, when it became a vital commodity, to enjoy this new chronicle of the U.S. emergence as a world superpower and a world oil power.

As the new book opens, Lefash, a minor character in the first book, witnesses the role Big Oil played in designing the post-Great War world at the Paris Peace Conference of 1919. Unjustly implicated in a murder perpetrated by Big Oil agents, LeFash takes the name Livingstone and flees to the U.S. to clear himself. Livingstone’s quest leads him through Babe Ruth’s New York City and Al Capone’s Chicago into oil boom Oklahoma. Stymied by oil and circumstance, Livingstone marries, has a son and eventually, surprisingly, resolves his grievances with the murderer and with oil.

In the new novel’s second episode the oil-and-auto-industry dynasty from the first book re-emerges in the charismatic person of Victoria Wade Bridger, “the woman everybody loved.” Victoria meets Saudi dynasty founder Ibn Saud, spies for the State Department in the Vichy embassy in Washington, D.C., and – for profound and moving personal reasons – accepts a mission into the heart of Nazi-occupied Eastern Europe. Underlying all Victoria’s travels is the struggle between the allies and axis for control of the crucial oil resources that drove World War II.

As the Cold War begins, the novel’s third episode recounts the historic 1951 moment when Britain’s MI-6 handed off its operations in Iran to the CIA, marking the end to Britain’s dark manipulations and the beginning of the same work by the CIA. But in Trabish’s telling, the covert overthrow of Mossadeq in favor of the ill-fated Shah becomes a compelling romance and a melodramatic homage to the iconic “Casablanca” of Bogart and Bergman.

Monty Livingstone, veteran of an oil field youth, European WWII combat and a star-crossed post-war Berlin affair with a Russian female soldier, comes to 1951 Iran working for a U.S. oil company. He re-encounters his lost Russian love, now a Soviet agent helping prop up Mossadeq and extend Mother Russia’s Iranian oil ambitions. The reunited lovers are caught in a web of political, religious and Cold War forces until oil and power merge to restore the Shah to his future fate. The romance ends satisfyingly, America and the Soviet Union are the only forces left on the world stage and ambiguity is resolved with the answer so many of Trabish’s characters ultimately turn to: Oil.

Commenting on a recent National Petroleum Council report calling for government subsidies of the fossil fuels industries, a distinguished scholar said, “It appears that the whole report buys these dubious arguments that the consumer of energy is somehow stupid about energy…” Trabish’s great and important accomplishment is that you cannot read his emotionally engaging and informative tall tales and remain that stupid energy consumer. With our world rushing headlong toward Peak Oil and epic climate change, the OIL IN THEIR BLOOD series is a timely service as well as a consummate literary performance.

Review of OIL IN THEIR BLOOD, The Story of Our Addiction by Mark S. Friedman

"...ours is a culture of energy illiterates." (Paul Roberts, THE END OF OIL)

OIL IN THEIR BLOOD, a superb new historical fiction by Herman K. Trabish, addresses our energy illiteracy by putting the development of our addiction into a story about real people, giving readers a chance to think about how our addiction happened. Trabish's style is fine, straightforward storytelling and he tells his stories through his characters.

The book is the answer an oil family's matriarch gives to an interviewer who asks her to pass judgment on the industry. Like history itself, it is easier to tell stories about the oil industry than to judge it. She and Trabish let readers come to their own conclusions.

She begins by telling the story of her parents in post-Civil War western Pennsylvania, when oil became big business. This part of the story is like a John Ford western and its characters are classic American melodramatic heroes, heroines and villains.

In Part II, the matriarch tells the tragic story of the second generation and reveals how she came to be part of the tales. We see oil become an international commodity, traded on Wall Street and sought from London to Baku to Mesopotamia to Borneo. A baseball subplot compares the growth of the oil business to the growth of baseball, a fascinating reflection of our current president's personal career.

There is an unforgettable image near the center of the story: International oil entrepreneurs talk on a Baku street. This is Trabish at his best, portraying good men doing bad and bad men doing good, all laying plans for wealth and power in the muddy, oily alley of a tiny ancient town in the middle of everywhere. Because Part I was about triumphant American heroes, the tragedy here is entirely unexpected, despite Trabish's repeated allusions to other stories (Casey At The Bat, Hamlet) that do not end well.

In the final section, World War I looms. Baseball takes a back seat to early auto racing and oil-fueled modernity explodes. Love struggles with lust. A cavalry troop collides with an army truck. Here, Trabish has more than tragedy in mind. His lonely, confused young protagonist moves through the horrible destruction of the Romanian oilfields only to suffer worse and worse horrors, until--unexpectedly--he finds something, something a reviewer cannot reveal. Finally, the question of oil must be settled, so the oil industry comes back into the story in a way that is beyond good and bad, beyond melodrama and tragedy.

Along the way, Trabish gives readers a greater awareness of oil and how we became addicted to it. Awareness, Paul Roberts said in THE END OF OIL, "...may be the first tentative step toward building a more sustainable energy economy. Or it may simply mean that when our energy system does begin to fail, and we begin to lose everything that energy once supplied, we won't be so surprised."

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